Amazon’s Twitch ready to take on Japan’s game-streaming market

Amazon’s game-broadcasting and social-video company, Twitch, is stepping up efforts to expand its presence in the nation that invented Mario, Pokemon and the PlayStation.

Twitch, which is currently participating in the four-day Tokyo Game Show that runs until Sunday, recently opened its Japan office and began localizing its platform for the Japanese audience. While still relatively unknown here, the service is considered one of the world’s largest live-streaming video platforms, boasting nearly 10 million daily active users and over 2.2 million unique streamers.

In Japan, however, it will face stiff competition from existing players and will have to tackle a gaming culture unique from that in the West.

“Are we going to win? That’s a tough question. But what we see is momentum and a lot of excitement for ideas we bring to the Japanese market,” said Michael Aragon, Twitch’s senior vice president of content, during a group interview in Tokyo on Thursday.

Without disclosing specific figures, Twitch said Japan is the third-fastest-growing market — South Korea is No. 1 — and has seen expansion and chat engagement double year on year. While viewers spend an average of 106 minutes per day watching content on Twitch, the figure skyrockets to over 300 minutes in Asia, it said.

“So we’re putting a disproportionate amount of resources into Japan and Asia in general because of what we see as an incredible opportunity, not just for live streaming for games, but for people that want to share their passion with others,” Aragon said, adding that Twitch plans to introduce a variety of new content in Japan including animation.

Twitch launched in 2011 as part of streaming site Justin.tv but soon overtook its parent’s popularity and spun off as its own brand. It was acquired by Amazon in 2014 for $1 billion.

Twitch allows people across the globe to watch one another play games. It also features a chat room that enables broadcasters and their audiences to interact in real time. Streamers can make money — some even make a living — through donations and sponsorships from fans. Popular streamers can partner with Twitch and install a subscription feature for their channels which users can buy for monthly fees.

Aragon said the many ways users can monetize through Twitch is one aspect that differentiates the service from competitors in Japan like popular video-sharing platforms Niconico and YouTube.

Twitch is also the go-to site for esports, or competitive gaming, which has morphed into a billion dollar industry globally but has yet to take off in Japan. “As soon as Japan is ready and we have a clear path to providing the same type of events and experience that we already provide globally, we will be the first in,” Aragon said.

But language barriers and different gaming habits could be obstacles for its success here, said Serkan Toto, a Tokyo-based gaming industry consultant.

“Western games, which are the core of Twitch’s content overall, are unpopular in Japan. Don’t they think getting local users to be a part of the global community, in addition to the lack of English skills, is an unsolvable problem?” Toto said.

Raiford Cockfield III, the head of Twitch’s Tokyo office, said language is indeed an issue, and said there have been instances where Japanese users shut down chats when people start chatting in different languages. “But we have seen the opposite too, there are streamers who get a global following … so there is an actual opportunity there,” he said.

Localization is the key to overcoming those obstacles and for Twitch’s success in Japan and elsewhere, he said.

“Since we understand how culturally important the written and spoken word are, we will have to dive really deep into local languages and local customs to make sure that the Japanese site plays well to the Japanese audience,” he said.

Japan is a heavily mobile-oriented market and gamers play longer and spend more money on mobile games than their American counterparts. A majority of mobile gaming revenue also goes to Japanese gaming companies.

Aragon said Twitch goes where the audience is, and recently introduced a refurbished mobile app.

“Japan has always been at the cutting edge in mobile games and mobile in general, whether it’s entertainment or gaming … so I think we put equal importance on mobile as we do on other platforms,” he said.